announced plans to spin off its manufacturing operations into a separate company. With this dramatic turn, not only rids itself of the financial burden of , it gains a hefty influx of cash from its partner in the deal, Advanced Technology Investment Co. (ATIC).

"I don't think this will give us a whole new AMD, but the industry will be dealing with an AMD that's a good deal more nimble because they won't be dealing with the same financial burdens or dealing with the fab plants," said , president of Mercury Research in Cave Creek, Ariz. "Because this lowers the break-even-point for AMD, it gives them staying power in the market and will help them focus on design and sales again."

Early in the decade, AMD had grabbed a solid footing in the semiconductor market. Its success was a key reasons for Intel's stumbles between 2003 and 2005. But come 2006, Intel responded with a reorganization that curbed AMD's momentum. After that, AMD stumbled under the financial burden of Inc. and the chip.

Both McCarron and Dan Olds, principal analyst at the Gabriel Consulting Group, said simply getting a big chunk of debt off its back could help the chipmaker regain some of the fire that once had it nipping at rival Intel's heels.

"It's like the old AMD after a spa and rehab vacation," said Olds. "They've come back stronger financially and in better shape overall. They're still the same company and they still [partially] own their fab operations. It's like they got a rich uncle to help them out."